The BHP Group Ltd (ASX: BHP) share price is up 1% after the mining giant revealed its operational update for June 2022.
BHP is involved in a few different commodities including iron ore, metallurgical coal, copper, nickel and potash.
June 2022 update
With the end of the last quarter of FY22, BHP was able to tell investors how it performed in the last three months of the financial year, as well as over the 12 months.
For the 12 months, copper production was 1,574kt, down 4%. But, the June 2022 quarter production of 461.8kt was up 25% compared to the March 2022 quarter thanks to higher volumes at Escondida due to increased grade and concentrator throughput. Spence saw improved leaching performance. Olympic Dam saw improvement after major smelter maintenance impacts in the prior period.
In FY22, iron ore production was flat at 253.2mt. The June 2022 quarter saw production of 64.2mt, up 8% with record production from the Mining Area C hub, with continued ramp-up of South Flank and improved supply chain performance.
Metallurgical coal saw production of 29.1mt in FY22, down 9%. The June 2022 quarter showed 8.2mt of production, which was up 3% thanks to improved truck productivity, partially offset by heavy rainfall in the quarter.
Nickel production was 76.8kt for the 12 months to June 2022, down 14% year on year. But for the June quarter, BHP produced 18.8kt, up 1% from the March quarter, there were reduced COVID-19 labour impacts.
Other comments
BHP noted that it achieved full year production guidance for iron ore and energy coal, as well as revised guidance for copper and metallurgical coal. Full year nickel production was lower than revised guidance due to a smelter outage in the June 2022 quarter.
Full year unit cost guidance is expected to be achieved for Western Australian Iron Ore and Escondida.
BHP also said that the Jansen (potash) project‘s shaft was completed in the June 2022 quarter. Jansen stage 1 is “tracking to plan”. It’s working to bring forward the Jensen stage 1 first production into 2026 and “are assessing options to accelerate Jansen stage 2.”
My thoughts on the BHP share price
BHP is Australia’s biggest business and what it reports can important ramifications for the ASX 200 (ASX: XJO). I think the mining company looks like a good opportunity for the long-term after dropping by 30% since 19 April 2022. Considering the cyclical nature of miners, it’s times like this that could mean it’s an effective time to buy shares, though I wouldn’t expect a big recovery in the iron ore price any time soon – that’s dependent on China.
